Payroll in Taiwan: Getting Compliance Right

Administering payroll in Taiwan requires a comprehensive understanding of the nation’s labour laws, taxation framework, and statutory contribution system. Taiwan follows a monthly payroll cycle, with salaries typically disbursed on or before the 15th of the following month. Although a 13th-month salary is not mandatory, it is customary for employers to offer it during major local festivals such as the Lunar New Year.

The statutory minimum monthly wage is TWD 28,590 (or TWD 190 per hour) and is reviewed periodically by the Ministry of Labour. Employers must comply with these wage standards and ensure that employment contracts specify remuneration, benefits, working hours, and entitlements with transparency and precision.

Employer contributions amount to approximately 21.83% of an employee’s salary, encompassing labour insurance, employment insurance, national health insurance, the labour pension fund, and workers’ compensation. Employees contribute around 4.65%, deducted directly from their monthly pay. Income tax is charged at progressive rates of 5% to 40% for residents, while non-residents are taxed at a flat rate of 18%. All taxes and social insurance payments must be remitted promptly to the relevant authorities.

Standard working hours are limited to eight per day and forty per week, with a maximum of twelve hours including overtime. Employers are obliged to provide two rest days per week and compensate overtime at enhanced rates. Leave provisions, maternity and paternity benefits, and occupational protections are all regulated under the Labour Standards Act.

Effective payroll in Taiwan underpins compliance, financial accuracy, and employee trust. For overseas companies establishing a presence in the market, engaging a professional payroll partner ensures precision and regulatory alignment.

Also read our guide: Comprehensive Checklist on Employment in Taiwan

Galaxy Group delivers comprehensive payroll and statutory management solutions, supporting organisations to operate confidently and compliantly within Taiwan’s evolving employment landscape.